Presenting our Lost in Translation: Company Culture installment! Over the course of four insight articles, we will break down the nitty-gritty of organizational culture. What it is, why it’s important, and other key factors you might not have considered otherwise.

Management inSites knows that establishing a U.S. subsidiary is an exciting and transformative step for any company. However, it also presents a unique challenge: how do you maintain your company’s core values, culture, and traditions while blending them with American expectations from both an employee and customer perspective? This is an essential question that all international companies must consider when expanding into the global market.

What is Culture? Why Is It Important?

Organizational culture is defined as the shared values, attitudes, and practices that characterize an organization^[1]. A summarized version can be found on a company’s banner or embedded within its ‘About Us page, but a company’s culture is more than just a hollow set of values thrown up on a website. It is a promise you make to both clients and employees alike. It is the intangible force within an organization that influences behavior and attitudes and, ultimately, has the power to make or break your venture. In fact, one study found that culture was the cause of 30 percent of failed integrations ^[2].

Several more studies have revealed that organizational culture is significantly interrelated with organizational performance. It often affects decision-making and leadership styles, which, in turn, affect an organization’s ability (or lack thereof) to change and innovate, as well as how employees work together and the beliefs they may hold regarding personal success. When examined within a business value framework, we can see how culture may (or may not) be the driving force behind an organization’s success.

Organizational Culture vs. National Culture

Due to its nebulous nature, it is accurate to assess culture as a multidimensional element within any group or organization. For instance, a 2001 study published by Geert Hofstede explored the differences in thinking and social actions among members of more than 50 nations and completely revolutionized the corporate understanding of the importance of organizational culture. Most poignantly, it found that “the National Culture of the organization always affects how the Organizational Culture is perceived”^[3]. This information is a key factor that international businesses must keep in mind as they expand into the U.S. market.

What’s Next?

Stay tuned for Part 2! We will delve deeper into the different elements of organizational culture before we move on to defining national culture and its impact.

[1] The 4 Types of Organizational Culture

[2] Cultural Issues in Mergers and Aquisitions

[3] Organizational Culture